Eastern posts 12% revenue growth

MANILA, Philippines - Ongpin-led Eastern Communications posted around P500 million in revenues in the first half of 2010 or 12 percent more than the same period last year, even as it sees less capital expenditure for the year.

Eastern marketing and business development head Edwin Domingo said their revenues grew by 12 percent from January to June on the back of higher broadband usage from its corporate clients.

“Profit is much better,” Domingo said, but refused to reveal figures.

The telecom firm expects yearend revenues to reach P1.1 billion this year while net income is expected to remain steady at P130 million.

Eastern is among the telecom companies being eyed by San Miguel Corp. (SMC) in the latter’s bid to boost its presence in the telco industry.

He also said the company will slow down on capex this year as the firm has already accelerated its investments on infrastructure last year.

Eastern spent over P1 billion last year for its Nasugbu fiber optic ring. “We are no longer leasing it from PLDT, that’s why our expenses this year are lower,” Domingo said.

According to him, corporate clients such as banks, telecom firms and business process outsourcing companies accounted for over 85 percent of Eastern’s total revenues.

Small and medium enterprises (SMEs) contributed five to seven percent of the firm’s revenues while residential subscribers accounted for three percent. The rest comes from government institutions.

As of end-June, Eastern had over 2,000 residential subscribers, 5,000 SME clients, and over 12,000 corporate clients. Its clients also include other telecom firms such as PLDT, Globe Telecom, Liberty Telecom Holdings, and international telecom companies for local service offering.

Eastern recorded P7 million to P8 million in net profits in the first three months of the year and a revenue of P250 million.

The company  provides data and internet leased circuits, full-service telephony and managed telecom services.